TECHTV3-C-26FEB01-BU-LH--TechTV, a cable channel in SF that offers round the clock programming about computers, is putting up a new studio (built in Los Angeles).
(BY LIZ HAFALIA/THE SAN FRANCISCO CHRONICLE) CAT less

TECHTV3-C-26FEB01-BU-LH--TechTV, a cable channel in SF that offers round the clock programming about computers, is putting up a new studio (built in Los Angeles).
(BY LIZ HAFALIA/THE SAN FRANCISCO CHRONICLE) ... more

Photo: LIZ HAFALIA

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TECHTV3-C-26FEB01-BU-LH--TechTV, a cable channel in SF that offers round the clock programming about computers, is putting up a new studio (built in Los Angeles).
(BY LIZ HAFALIA/THE SAN FRANCISCO CHRONICLE) CAT less

TECHTV3-C-26FEB01-BU-LH--TechTV, a cable channel in SF that offers round the clock programming about computers, is putting up a new studio (built in Los Angeles).
(BY LIZ HAFALIA/THE SAN FRANCISCO CHRONICLE) ... more

Comcast, the nation's largest cable operator, bought San Francisco's TechTV from billionaire Paul Allen, and announced it would merge the channel with its G4, a cable channel devoted to video games.

Sources close to the deal pegged the sale price at below $300 million.

TechTV, the cable channel devoted to all things technological, will lose its identity, as the deal appears orchestrated to catapult the younger G4 into the millions of homes TechTV now reaches.

"This is a teardown," said John Higgins, deputy editor of the trade magazine Broadcasting and Cable. In real estate, he said, "you buy the house, tear it down, and build a new house on it."

"They're buying this for the value of the land, not the value of the building on it," Higgins said. "It's very hard for a startup network like G4 to secure distribution. (With this deal), they can buy it overnight."

G4, which Comcast started in 2002, reaches 13.3 million homes, predominantly via digital cable. TechTV, which was begun in 1998 as ZDTV -- the broadcast arm of the once-powerful tech publisher Ziff Davis -- now reaches 43 million homes, via digital and analog cable as well as satellite.

Those figures, however, don't necessarily translate into viewers, and in the increasingly fragmented world of cable television, TechTV's ratings were minuscule, Higgins said.

In Higgins' view, TechTV sold cheaply -- less than $8 for every subscriber reached. By contrast, Cablevision sold Bravo, another channel with low ratings, to NBC in November 2002, for $1.25 billion, roughly $20 per subscriber.

EchoStar's Dish Network, which was a minority owner of TechTV, will maintain its stake in the newly merged company.

Officials wouldn't discuss how many layoffs are expected, although Charles Hirschhorn, the founder and CEO of G4, who will run the combined company, told The Chronicle, "There's lots of overlap."

TechTV employs about 300 people, and G4 employs about 200. Hirschhorn said he does not yet know how many people will work for the combined company. "Common sense dictates it's not going to be 500," he said.

The new company will be based in Los Angeles, the home of G4.

Hirschhorn, 46, a former movie producer and for 10 years an executive at the Walt Disney Co., founded G4 when he saw the burgeoning business of video games.

The gaming industry now outsells even Hollywood movies, earning $28 billion globally in 2002, according to a fact sheet G4 released Thursday.

"I couldn't help but notice that video games were the fastest-growing entertainment form in the country, year after year after year," Hirschhorn said.

TechTV officials declined to comment on the merger, other than to issue a brief statement from Joe Gillespie, the chief operating officer.

"Last year, we began investigating ways we could take our business to the next level," Gillespie said in the statement. "Since then, TechTV has seen tremendous growth in terms of ratings and ad revenue. Today, we are pleased to say Comcast has stepped up to build upon this growth. By combining the resources of TechTV and G4, Comcast will join two complementary brands and create a smart and edgy powerhouse channel for the tech savvy, Internet generation."

TechTV, which once employed 450 people, has undergone several rounds of layoffs and programming changes in the years since the dot-com bust wiped out many of its advertisers.

In 2001, it introduced an ambitious all-day news format called "TechLive, " designed to make the station the CNBC for technology news. All that remains of "TechLive" now is a half-hour show.

"They were pouring all their money into day parts, where their audience wasn't home to watch it," said Higgins, the trade journalist. "It was a silly strategy on its face."

Higgins did praise TechTV's monumental accomplishment of getting its programming into 43 million homes.

Many cable operators viewed the content of TechTV as something that could lure early adopters to buy new digital delivery.

Now, under Comcast's ownership, that audience should expand, he said, noting that Comcast, the nation's largest cable operator, serves 21 million homes.

Comcast claims that it will not force its local cable outlets to take G4 just because the parent company owns it.

Unlike other cable operators, Comcast does not own any major cable channels, although that would change if its proposed hostile takeover of the Walt Disney Co. is successful.